2019 is the Time to Improve Your SBA Servicing and Liquidation Skills
One of the most critical times to understand proper SBA Servicing is when your SBA Loan becomes a non-performing loan. Not properly servicing a non-performing SBA loan could result in a repair of the guaranty or possibly a denial of the SBA guaranty. There are several areas of servicing that need to be addressed in properly servicing a non-performing SBA loan.
One question that I am often asked is when should a SBA loan be moved into liquidation. Moving a SBA loan into liquidation status is clearly defined by SBA. When a SBA Loan is 60 days past due or an adverse event such as a bankruptcy of the borrower or guarantors or litigation against the borrower or guarantors occur, the SBA loan should be requested to be placed in Liquidation status. It is important to note that after a loan is put into liquidation status, the loan can be moved back into regular status if the borrower brings the loan current and keeps the loan current for a period of time. Understanding the next steps once a loan is put into liquidation and which SBA Servicing Center you will be working with is very important in the proper servicing of this loan.